It seems that the US is at odds with G-8 leaders in Toronto with regard to extending the failed easy-money policy rather than taking the medicine of austerity.
To meet that 2% inflation target, Prime Minister Abe has put forth an aggressive ultra-easy monetary policy which will pump more money into the economy and also weaken the yen.
The least significant part of the policy is the promise of easy money through mid-2015, which can be rescinded if the opportunity arises, and the confirmation of operation twist through the end of the year.
It worried that policy-making was stuck as former finance secretary Espiritu (who wanted easy money and strong public spending to boost growth) skirmished with central bank chief Rafael Buenaventura (who wanted to curb the budget deficit and keep the peso steady).
The bottom line: The resumption of easy money policy by the Federal Reserve in the aftermath of the 2008 financial crisis has re-affirmed and broadened the positive correlation of different asset categories, undermining the effectiveness of asset diversification strategy in reducing market risk.